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ICICI Securities

Published on 22/01/2021 11:44:44 AM

Technical Outlook

Equity benchmarks witnessed profit booking as Sensex approached the psychological mark 50000. The Nifty entirely pared intraday gains and concluded weekly derivative expiry session on a subdued note at 14590, down 54 points or 0.4%.

In the coming session, we expect Nifty to hold Thursday’s panic low (14517) and trade with a positive bias amid stock specific action as we proceed the Q3FY21 result season. Hence, use dip towards 14530-14555 for creating long for target of 14641

Going ahead, we expect index to endure its northbound journey amid rising volatility ahead of key major event of Union Budget and eventually head towards our earmarked target of 14900 by the end of January.

Thus, buy on declines would be the prudent strategy as possibility of minor profit booking at higher levels cannot be ruled out which would offer incremental buying opportunity to ride next leg of up move. Meanwhile, immediate support remains at 14200.

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ICICI Securities

Published on 22/01/2021 11:44:06 AM

Bank Nifty: 32186

Technical Outlook

* The Bank Nifty traded with high volatility on account of the weekly expiry as it snapped its two sessions up move and closed lower by more than 1 % on Thursday . The profit was broad based as 10 out of the 12 index constituents closed in the red . Nifty bank index ended the session at 32186 , down by 356 points or 1 . 1 % 

* The daily price action formed a bear candle which engulfed previous session price action signalling profit booking at higher levels after the recent strong up move ahead of key major event of Union Budget

* Going forward, index holding above Monday’s panic low (31650) will keep the bias positive and will lead to extension of the current up move towards our earmarked target of 33000 levels in the coming weeks as it is the measuring implication of the recent range breakout (31000 -29000 ) .

* In line with our view, the current up move is in a zig -zag formation wherein intermittent episodes of profit booking at higher levels around the vicinity of our target of 33000 is being witnessed after a 13 % rally (28976 -32718 ) in just five weeks which has hauled weekly stochastic oscillator in overbought territory (currently placed at 92 ) . However, temporary breather should not be seen as negative, instead it should be capitalised as an incremental buying opportunity

* The upper band of the recent range breakout placed around 31000 -30900 levels is likely to act as major support in the short term . It also confluence with the following technical observations : a) 38 . 2 % retracement of the current up move (28976 -32718 ) placed at 31270 levels b)The rising 34 days EMA which has acted as a strong support since October is also placed around 30930 levels

* In the coming session, the index is likely to open on a flat note on the back of muted global cues . W e expect the index to trade in a range with high volatility while holding above Monday’s low (31650 ) . Hence use intraday dips towards 31950 -32010 in Bank Nifty January future for long position for target of 32230 , maintain a stoploss of 31840

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ICICI Securities

Published on 22/01/2021 11:43:52 AM

NSE (Nifty): 14590

Technical Outlook

* Equity benchmarks witnessed profit booking as Sensex approached the psychological mark 50000. The Nifty entirely pared intraday gains and concluded weekly derivative expiry session on a subdued note at 14590, down 54 points or 0.4%. Market breadth turned in favour of declines with A/D ratio of 1:2. Sectorally, all major indices ended in red weighed by metal and pharma 

* The Nifty opened the session with a positive gap and scaled to a fresh all time high (14754). However, profit booking from higher levels dragged index lower yet managed to hold Wednesday’s low (14518) and eventually recovered 110 points from day’s low. As a result, index formed a bear candle with shadows on either side, highlighting breather after a faster retracement amid elevated volatility (as index seen ~440 points movement during the session)

* Going ahead, we expect index to endure its northbound journey amid rising volatility ahead of key major event of Union Budget and eventually head towards our earmarked target of 14900 by the end of January. Thus, buy on declines would be the prudent strategy as possibility of minor profit booking at higher levels can not be ruled out which would offer incremental buying opportunity to ride next leg of up move towards 14900, as it is confluence of:

* a)138.2% extension of May-September rally (8806-11794), projected from September low of 10790, placed at 14919

* b) Long term resistance trend line, drawn adjoining November 2010 March 2015 highs of 6334-9119, placed around 15000

* The broader market indices have taken a breather by retracing less than 38% of past three weeks rally which has helped daily stochastic oscillator to cool off the overbought condition (currently placed around 60).

* Eventually we expect, broader market indices to relatively outperform the benchmark wherein small cap index would outshine. Key point to highlight is that the Nifty midcap index has surged to new life-time highs, whereas small cap index is still ~22% away from all time high. Thus, we expect small caps to witness catch up activity

* The formation of higher peak and trough on the larger degree chart highlights robust price structure that makes us confident to retain support base at 14200 as it is 38.2% retracement of current up move (13131-14753) at 14134 coincided with 20 EMA at 14167 and Monday panic low of 14222 In the coming session, we expect Nifty to hold Thursday’s panic low (14517) and trade with a positive bias amid stock specific action as we proceed the Q3FY21 result season. Hence, use dip towards 14530-14555 for creating long for target of 14641

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ICICI Securities

Published on 21/01/2021 3:35:56 PM

Below are Views On Sensex crossing the important milestone of 50,000 is a telling sign of economy By Mr. Vijay Chandok - MD & CEO, ICICI Securities

Sensex crossing the important milestone of 50,000 is a telling sign of economy and markets shifting orbits on broad-based recovery and better days ahead. The combination of strong capital inflows, low interest rates and leaner balance sheet of India corporates along with government measures for growth is expected to lift the economic growth ahead.  The same is likely to resonate in capital markets, thereby keeping the markets buoyant in the long term.

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ICICI Securities

Published on 21/01/2021 12:01:44 PM

Bank Nifty: 32543

Technical Outlook

* The Bank Nifty gained for the second consecutive session and closed higher by 0 . 4 % on Wednesday . The PSU banking stocks outperformed as the PSU bank index closed higher by more than 2%, while the private banking stocks traded in a range and closed on a flat note . Nifty bank index closed at 32543 , up by 0 . 4 % 

* The daily price action formed a small bull candle with a higher high -low signalling continuation of the up trend . The index opened on a firm note and traded in a range with positive bias to form an intraday high (32607 ) in the second half of trade

* Going forward, we expect the index to extend the current up move and head towards our earmarked target of 33000 levels in the coming weeks as it is the measuring implication of the recent range breakout (31000 -29000 ) .

* We believe subsequent up move from here on would be in zig - zag formation wherein intermittent episodes of profit booking at higher levels cannot be ruled out after a 13 % rally (28976 -32718 ) in just four weeks which has hauled weekly stochastic oscillator in overbought territory (currently placed at 92 ) . However, temporary breather should not be seen as negative, instead it should be capitalised as an incremental buying opportunity

* The upper band of the recent range breakout placed around 31000 -30900 levels is likely to act as major support in the short term . It also confluence with the following technical observations : a) 38 . 2 % retracement of the current up move (28976 -32718 ) placed at 31270 levels b)The rising 34 days EMA which has acted as a strong support since October is also placed around 30900 levels

* In the coming session, the index is likely to open on a positive note on the back of firm global cues . Volatility is likely to be high on account of the weekly expiry . However, we expect the index to maintain higher high -low and trade with positive bias . Hence after a positive opening use intraday dips towards 32520 -32580 in Bank Nifty January future for long position for target of 32780 , maintain a stoploss of 32410 Among the oscillators the daily stochastic has generated a buy signal thus supports the positive bias in the index

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ICICI Securities

Published on 21/01/2021 12:01:34 PM

NSE (Nifty): 14645

Technical Outlook

* Equity benchmarks extended gains over second consecutive session amid buoyant global cues. The index steered past its previous high of 14653 and recorded fresh all time high of 14666. The Nifty ended Wednesday’s session at 14645, up 124 points or 0.85%. Market breadth remained positive with A/D ratio of 1.1:1. Barring FMCG, all other indices ended in green led by Auto and IT 

* The daily price action formed a bull candle carrying higher high-low, indicating continuation of ongoing up move as index witnessed follow through strength to last session’s swift up move. As a result, Nifty entirely retraced past four sessions corrective move (14653- 14222) in just two sessions. The faster pace of retracement signifies structural improvement that augurs well for next leg of up move

* Going ahead, we expect index to endure its northbound journey and eventually head towards 14900 by the end of January. Meanwhile, stock specific activity would continue as we proceed Q3FY21 earnings season. The sturdy move above the previous life-time high of 14653 backed by strong market breadth and broad based market participation has also confirmed a higher bottom in place at Monday’s low of 14200 and signals further acceleration of upward momentum towards our target of 14900, as it is confluence of:

* a)138.2% extension of May-September rally (8806-11794), projected from September low of 10790, placed at 14919

* b) Long term resistance trend line, drawn adjoining November 2010 March 2015 highs of 6334-9119, placed around 15000

* The broader market indices have regained momentum after retracing less than 38% of past three weeks rally which has helped daily stochastic oscillator to cool off the overbought condition (currently placed around 50). We expect, broader market indices to relatively outperform the benchmark wherein small cap index would outshine. Key point to highlight is that the Nifty midcap index has surged to new life-time highs, whereas small cap index is still ~22% away from all time high. Thus, we expect small caps to witness catch up activity

* The elevated buying demand highlights robust price structure that makes us confident to retain support base at 14200 as it is 38.2% retracement of current up move (13131-14666) at 14300 coincided with 20 EMA at 14167 and Monday panic low of 14222 In the coming session, volatility would remain high owing to weekly derivative expiry. However, we expect index to trade with a positive bias while maintaining higher-low formation. Hence, post positive opening, use dip towards 14640-14665 for creating long for target of 14744

Click Here - https://bit.ly/2LS7wPl

Please refer disclaimer at https://www.icicisecurities.com/AboutUs/?ReportID=10445

ICICI Securities

Published on 21/01/2021 12:01:02 PM

Technical Outlook

Equity benchmarks extended gains over second consecutive session amid buoyant global cues. The index steered past its previous high of 14653 and recorded fresh all time high of 14666.

The Nifty ended Wednesday’s session at 14645, up 124 points or 0.85%. In the coming session, volatility would remain high owing to weekly derivative expiry. However, we expect index to trade with a positive bias while maintaining higher-low formation. Hence, post positive opening, use dip towards 14640-14665 for creating long for target of 14744 Going ahead, we expect index to endure its northbound journey and eventually head towards 14900 by the end of January.

Meanwhile, stock specific activity would continue as we proceed Q3FY21 earnings season. The sturdy move above the previous life-time high of 14653 backed by strong market breadth and broad based market participation has also confirmed a higher bottom in place at Monday’s low of 14200 and signals further acceleration of upward momentum.

Click Here - https://bit.ly/3p3nXXr

Please refer disclaimer at https://www.icicisecurities.com/AboutUs/?ReportID=10445

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